The Algerian state company Sonatrach has concluded a three-year contract with the French energy group Engie regarding the price of the gas that will be delivered through the Medgaz submarine gas pipeline, with a capacity of 10 billion cubic meters per year, AFP reports.

Sonatrach and Engie “reached an agreement in Algiers on the contract for the supply and sale of natural gas through Medgaz”. The contract between the two companies, concluded since 2011, ensures the supply of Engie with natural gas by Sonatrach, through the Medgaz gas pipeline, the Algerian company announced in a release, according to Agerpres.

The companies agreed “that the sale price under the contract, which will apply for a period of three years, until 2024, be set according to market conditions,” Sonatrach said, without disclosing the price.

Since Russia’s invasion of Ukraine and the imposition of Western sanctions, gas has become much more expensive, and the price of energy in the eurozone has risen 41.9 percent annually, according to Eurostat data.

At the signing of the agreement, Sonatrach and Engie also confirmed “their intention to expand the partnership in the field of liquefied natural gas (LNG) and natural gas. The agreement will allow the Algerian group to” strengthen its share in Engie’s supply portfolio,” the Algerian company said.

Engie is a major economic player in Algeria, especially in the gas exploration and production segment, being also the country’s main buyer of LNG.

Algeria supplies about 11% of the gas consumed in Europe, compared to 47% in the case of Russia.